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BioNano Raises $53M to Identify “Structural Variations” in Genome

Thu, 11/20/2014 - 21:44
Bruce V. Bigelow

San Diego-based BioNano Genomics, which has taken a fundamentally different approach to analyzing the genome, says today it has closed on $53 million in Series C financing to expand its commercialization efforts in North America, China, and Europe.

Legend Capital, a Beijing-based venture fund affiliated with Lenovo’s controlling shareholder, led the round with the Novartis Venture Fund. They were joined by two other new investors, Federated Kaufmann Fund and Monashee Investment Management, and existing investors Domain Associates, Battelle Ventures, and Gund Investment.

“We’re delighted to have a Chinese financial partner who can help us chart the waters there,” CEO Erik Holmlin said by phone. BioNano sold its high-throughput Irys System to the Chinese Academy of Sciences in Beijing just over a year ago, and Holmlin said Legend will be “an amazing partner as we begin expanding our footprint in China.”

At $53 million, the round amounts to one of the largest private financing deals in the U.S. life sciences sector this year. Including the round, the company has raised a total of roughly $92 million since BioNano moved to San Diego three years ago as part of a turnaround.

BioNano does not use the short-read, next-generation genome sequencing technology employed by San Diego-based Illumina (NASDAQ: ILMN) or ThermoFisher Scientific’s Carlsbad, CA-based Life Technologies business.

Erik Holmlin

Conceptually speaking, next-gen sequencing is comparable to assembling a jigsaw puzzle with tens of millions or hundreds of millions of pieces. In constrast, Holmlin said, “We’re putting the jigsaw puzzle together with really large pieces.” BioNano’s Irys System does not produce the resolution that comes with sequencing every DNA base pair, but Holmlin said, “all the functional components are going to be in the right place.”

BioNano’s Irys System uncoils DNA molecules into long contiguous strands that are tagged with fluorescent enzymes at specific sites and drawn by an electric current into proprietary “nano channel” arrays, where they are aligned for high-resolution imaging. The resulting images of tagged DNA molecules are converted into digital data.

BioNano says its technology makes it possible for … Next Page »

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West Coast Biotech Roundup: Gilead, Juno, Hutch, Fibrogen & More

Thu, 11/20/2014 - 18:21
Alex Lash

Snow? What snow? The only thing piling up at astonishing rates on the West Coast this week is biotech news. Up in Seattle, the Fred Hutchinson Cancer Research Center has unveiled its new president, and its neighbor Juno Therapeutics filed to go public—two events not entirely unrelated, as we note here.

Down the coast, Gilead Sciences made news all week with a fascinating voucher purchase, a pricing deal with France (the country, that is), and a new European approval. In San Diego, researchers produced a picture of antibodies attacking Ebola, even while the mainstream media has decided, post-election, Ebola isn’t as newsworthy anymore.

We’ve got plenty more to round up out West, so let’s start shoveling.

—The Fred Hutchinson Cancer Research Center named D. Gary Gilliland its new president and director. His previous gigs were VP of precision medicine at the University of Pennsylvania’s Perelman School of Medicine, head of oncology at Merck Research Labs, and a 20-year stint at Harvard Medical School.

— Juno Therapeutics of Seattle filed paperwork to go public this week, less than a year after it emerged from stealth. The firm has raised $310 million from the state of Alaska, ARCH Venture Partners, Venrock, Jeff Bezos’s family foundation, and others.

—Structural biologists at The Scripps Research Institute in San Diego have produced the first image that shows how ZMapp, the experimental drug developed by Mapp Biopharmaceutical, binds to the Ebola virus. The image reveals weak spots on the surface of Ebola that are targeted by antibodies in ZMapp.

—Gilead Sciences (NASDAQ: GILD) of Foster City, CA, bought an FDA priority review voucher for $125 million from Canadian firm Knight Pharmaceuticals. The FDA awards these vouchers to companies that bring to market treatments for neglected tropical diseases and rare pediatric diseases. The voucher allows for faster review once a company asks FDA for a drug approval. It’s also transferable, which is why Knight was able to sell its voucher, which it earned for a drug to treat leishmaniasis.

—Gilead also struck a deal with France to lower the price of sofosbuvir (Solvadi), the hepatitis C drug it began selling this year with an $84,000 price tag in the U.S. Not in France. The country’s health ministry announced Thursday “the lowest public price in Europe” (the translation is our own). which puts a 12-week course of the drug at about $51,500.

—More Gilead: The European Union approved hep C drug Harvoni. It combines sofosbuvir and another antiviral ledipasvir, and does not require an additional dose of interferon, which sofosbuvir alone requires.

—Last Friday, San Francisco’s Fibrogen (NASDAQ: FGEN) went public and raised $146 million as it pushes forward with a treatment for anemia in people with kidney failure. CEO Thomas Neff and development partner Astellas Pharma were the only shareholders with more than 5 percent ownership pre-IPO.

—San Diego-based Organovo (NASDAQ: ONVO) has introduced a new commercial product—a multiwell micro-titer plate containing bio-printed 3D human liver tissue which can be used in preclinical drug testing.

—Berkeley, CA-based Caribou Biosciences put its genome-editing platform technology, based on CRISPR/Cas9, into a new Boston-area startup. Intellia Therapeutics launched Tuesday with exclusive license to use Caribou technology in human therapeutics. Caribou has an equity stake, while Atlas Venture and Novartis (NYSE: NVS) led Intellia’s $15 million Series A round.

—In San Diego, Receptos (NASDAQ: RCPT) priced a secondary stock offering that raised $360 million. The company, developing a drug to treat several autoimmune diseases, sold 3.6 million shares at $100 each.

—Steve Dowdy of the University of California, San Diego published in Nature Biotechnology a comprehensive look at the RNA interference technology under development in his lab. That work, which could significantly expand the use of RNAi-based therapies, is licensed exclusively to San Diego’s Solstice Biologics.

—With Ebola on his mind, Fortune’s Dan Primack asked Beth Seidenberg of Kleiner Perkins Caufield & Byers: Whatever happened to KP’s pandemic flu fund?

—After we posted the previous roundup last Thursday, Geron (NASDAQ: GERN) of Menlo Park, CA, announced a deal to hand worldwide rights for its lead drug imetelstat to Janssen Biotech, a division of Johnson & Johnson (NYSE: JNJ). Geron gets $35 million immediately. Future payments could bump the total to $900 million.

—Cue, a San Diego startup developing a wireless diagnostic device that enables consumers to run clinical lab tests to measure their own health, raised $7.5 million in a Series A round led by San Francisco-based Sherpa Ventures. Cue plans to use the funding to begin production of its device.

—The Infectious Disease Research Institute in Seattle said Wednesday it has received $3.6 million from the National Institutes of Health to develop a tuberculosis vaccines that isn’t damaged by heat or cold. The grant could be worth up to $11.9 million if IDRI hits a series of milestones.

—San Diego-based DermTech withdrew its planned IPO, citing poor market conditions. The company is developing non-invasive tests of gene expression that help diagnose various skin conditions. DermTech filed confidentially for its IPO in April.

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With Uber Investor Driving, Cue Raises $7.5M for Personal Dx Device

Wed, 11/19/2014 - 02:14
Bruce V. Bigelow

The VC who placed a $26.5 million bet on Uber in 2011 is now leading a $7.5 million investment round in Cue, a San Diego startup developing a wireless diagnostic device that enables consumers to run clinical lab tests at home to measure their own health.

In a statement from Cue yesterday, Sherpa Ventures managing director Shervin Pishevar said the five-year-old company is taking a unique approach to consumer health, and “is a prime example of the ‘on demand’ economy applied to health and wellness.”

Pishevar, who left Menlo Ventures to found San Francisco-based SherpaVentures in 2013 (with former Goldman Sachs Internet investor Scott Stanford), has gained visibility in recent years as a well-connected Silicon Valley VC with an inside track in consumer and social Web deals. In addition to Uber, the Iranian-born Pishevar put Menlo into Fab.com, Warby Parker, and Tumblr, and was an angel investor in TaskRabbit, Klout, and dozens more. A recent profile in Bloomberg Businessweek describes how Pishevar’s extensive network connects to such tech billionaires as Elon Musk, Hollywood power brokers like Jeffrey Katzenberg, and political strategists in the White House and elsewhere.

Presumably, Pishevar was responsible for getting some angel investors into the deal, which The Wall Street Journal identified as Hollywood star Leonardo DiCaprio, Salesforce.com chief executive Marc Benioff, and former Obama campaign manager Jim Messina.

Cue desktop device, with cartridge inserted (photo courtesy Cue)

The company, which has 11 employees, also disclosed that Immortalana, a mini-fund founded by digital media executive Kelly Day and UCLA medical researchers Robin Farias-Eisner and Srinivas Reddy, also participated in the round as an angel investor. (Cue previously raised about $2 million from angel investors.) Farias-Eisner, a specialist in gynecologic cancer who serves as director of UCLA’s Center for Biomarker Discovery and Research, was named to Cue’s board of directors, along with Pishevar.

Yet Pishevar obviously was a key selling point for Cue founder and CEO Ayub Khattak, who told me by phone, “We were really happy to connect with him, because his record speaks for itself. We chose him—and he chose us on this technology that completely transforms how … Next Page »

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Breaking Bottlenecks, Opening the Floodgates to Genomic Data

Tue, 11/18/2014 - 08:00
Hannes Smárason

There is a major transformational step underway for managing the growing amount of human genomic data. To date, the focus has been on amassing databanks of genomes and then developing new tools to analyze this information. In essence, the emphasis has been on breaking bottlenecks for analyzing the data.

Now, there is an opportunity to take progress in a new direction, to move beyond amassing genomic data and enable researchers to share genomic knowledge worldwide, and ultimately, at the point of patient care. This next era will dramatically change how genomic data can be accessed, shared, and interpreted on a global scale.

The demand for distributed, global access to information is evident from our day-to-day interaction with data. With access to data in nearly everything we do—from using Google Maps for directions to getting the weather forecast—we know that the norm is to get information in real-time, from a browser interface. The ability to do so with large sets of genetic data represents the next wave of progress in the genomic era.

Many of us in this field are captivated by the opportunities to use genomic insights to advance medicine. So, let’s take a look at the progress made in managing these data for clinical use:

Early genome sequencing and analysis: The concept of genomics in medicine was catalyzed by the Human Genome Project in the early 2000s, after which the research community, governments, and industry spent nearly a decade understanding how to sequence genomes, find useful information, and build equipment to facilitate more efficient processes. The progress led to a host of important discoveries about the genome and its impact on disease risk and treatment response. I personally was involved in these early pioneering efforts, working with deCODE Genetics on a population-scale platform in Iceland that has compiled the largest collection of whole-genome variation data in the world. Even back then, that genomic engine identified scores of important genetic variations associated with common diseases, groundbreaking discoveries that laid the foundation for gauging the inherited risk of conditions like prostate cancer and heart attacks.

Mainstream sequencing genomic data: With more experience and success with sequencing, industry leaders set out to make genomics vastly more accessible with improved technologies that made sequencing cheaper, faster, and easier. We’ve now reached the threshold of the $1,000 genome—enabling major centers to integrate sequencing and use genome-guided information to advance their research and generate new ideas about genomic causes to a range of challenging diseases.

Analyzing genomic data: Harnessing this progress, we have witnessed in recent years a whole new generation of genomics players, with a range of companies introducing new analytics tools and software to aid with sequencing and analysis. This flurry of activity has generated new techniques with a range of purposes—from identifying single variants to broad patterns—that can impact everything from a single rare disease to an entire therapeutic category. While many of these tools will continue to be used for niche applications, some (particularly those that are successfully scaling up) will likely become industry standards that can manage large-scale datasets and support broad, cross-institution genomic research in the near future.

Amassing genomic datasets and liberating them: Today, as organizations amass vast amounts of genomic data, they are looking for ways to share this information and work with one another to consolidate the data and generate reliable, consistent conclusions about disease causes, risks, and responses. Based on these efforts, new databases are emerging that catalogue genetic variation, offering invaluable “Big Data” style resources for the world’s research community. Just two weeks ago at the American Society of Human Genetics’s annual meeting, several new … Next Page »

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New Study Shows How ZMapp Binds to Ebola, Ways to Boost Potency

Mon, 11/17/2014 - 18:18
Bruce V. Bigelow

Scientists at The Scripps Research Institute have produced the first 3-D image of how the ZMapp drug developed by San Diego’s Mapp Biopharmaceutical binds to the Ebola virus, providing new insights about how the drug works and how it might be improved.

ZMapp is an experimental drug that combines three “humanized” monoclonal antibodies. Mapp Bio had produced only a limited amount for research purposes as the Ebola epidemic in West Africa mushroomed into a full-blown crisis this summer.

ZMapp was given to seven Ebola-infected patients under an emergency authorization, and five survived—including American caregivers Kent Brantley and Nancy Writebol. But there’s no way to scientifically validate the survivors’ outcomes, or to say whether ZMapp made a difference in their recoveries.

Structural biologists Andrew Ward and Erica Ollmann Saphire of the Scripps campus in San Diego released the results of their study online today, ahead of the publication of their paper in Proceedings of the National Academy of Sciences.

Using an imaging technique called electron microscopy, the study shows that two of the ZMapp antibodies bind to the same site near the base of the Ebola virus, and appear to prevent the virus from penetrating the surface of cells in the body. A third antibody binds to the virus in a more exposed site, and may act as a beacon calling for an immune response to the infection.

ZMapp antibodies (in color) binding to Ebola (courtesy TSRI)

In an e-mail this morning, Saphire says a computer-generated image produced from the data represents the first structural picture of how ZMapp interacts with Ebola. She writes, “This is the first time we have done single particle electron microscopy instead of X-ray crystallography, and the first foray of the Ward lab into Ebola virus research.”

Saphire explains that the two antibodies that bind to the same site of Ebola may be redundant or even competing with each other. “If the two are truly redundant, then this could represent an opportunity for improvement,” Saphire writes. “The weaker or more poorly-producing one of the two could be replaced with more of the stronger, or with a third antibody against a distinct site for added potency.”

Understanding the binding sites and structure of the virus would be useful to many labs developing other antibody therapeutics and vaccines, Saphire added.
The new study also shows that the sites where the ZMapp antibodies bind to Ebola have so far been unaffected by the more than 300 genetic changes identified in the current strain of the virus by research published in August.

“The mutations known thus far do not prevent ZMapp binding, but more sequencing needs to be done to determine if the virus has evolved further,” Saphire writes.

“One reason we are doing the single particle electron microscopy as part of our global Ebola antibody consortium is to rapidly map where antibodies attach to the Ebola virus surface protein. By having the maps of all the known antibodies available, we could rapidly select replacement antibodies in case the virus mutates away from current therapies.”

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New Research Could (Finally) Remove RNAi’s Commercial Limitations

Mon, 11/17/2014 - 13:05
Alex Lash

[Corrected 11/17/14, 12:30pm. See below.] If nothing else, the acronym RNAi, which stands for ribonucleic acid interference, should be familiar to biotech observers as something that won two researchers the Nobel Prize in 2006, and that a few companies have tried to turn into drugs. Alnylam Pharmaceuticals (NASDAQ: ALNY) is the most well-known. But in treating human disease, its promise has outpaced its utility.

In Nature Biotechnology today, University of California, San Diego researcher Steve Dowdy and colleagues have published a paper that Dowdy says could be the foundation that drug developers use to overcome the biggest obstacle keeping them from delivering upon RNAi’s promise.

Or perhaps it’s better to say: the foundation that one drug developer uses. That’s because Dowdy’s work is the exclusive property of San Diego-based Solstice Biologics, a two-year-old, venture backed firm that Dowdy cofounded. I’ve written about Solstice and its dramatic history before, most recently in June when it hired Lou Tartaglia away from Third Rock Ventures to become CEO.

Dowdy, Tartaglia, and others involved in Solstice believe they’ve cracked a very important code—how to get RNAi drugs into all manner of cell types. They have voiced that belief for some time now, and some of the specifics of Dowdy’s work are well known. But the paper published today provides a more intricate look under the hood, and supplemented with conversations with Dowdy, Tartaglia, and Solstice chief scientific officer Curt Bradshaw, also gives a clearer idea of what Solstice still needs to do to turn its ambition into breakthrough RNAi medicines.

Turning the fascinating mechanism of RNAi into a widely deployed weapon against cancer, infectious disease, and more would indeed be a breakthrough. To date, Alnylam and a few others have only advanced drugs to treat liver and eye disease, the only tissue types relatively amenable to RNAi delivery. (Nothing yet has been approved; Alnylam’s most advanced program, aimed at a genetic disease called TTR amyloidosis, is in Phase 3.)

In fact, those delivery problems bedeviled other early enthusiasts, often with much deeper pockets: Roche and Novartis ((NYSE: NVS), two of Alnylam’s first development partners, dropped their programs after a few years; and Merck & Co. ((NYSE: MRK), which bought Alnylam’s rival Sirna Therapeutics for $1 billion in 2005, ended up selling those assets in 2014 for $175 million (of which only $25 million was cash)—to Alnylam, no less.

It’s easy to see why so many companies spent so much money within a few years of RNAi’s emergence. The overarching concept is simple and elegant. The DNA code of life must be transcribed, transported out of the nucleus, and ferried to the main part of the cell, the cytoplasm, where ribosomes await to turn the code into proteins.

The bridge between DNA and protein is RNA, or, because of the nature of its job, messenger RNA (mRNA). You’ve heard people say “Don’t shoot the messenger”? Substitute “hijack and slice up” for “shoot,” and there you have RNAi: If the mRNA is hijacked and destroyed on its way to the ribosome, the protein in question never gets produced. (A common description of RNA interference is “gene silencing.”)

How that happens inside a cell is complex and includes more than one form of RNA and enzymes that do the slicing and dicing.

It’s a mechanism that helps cells defend against intruders like viruses, whose genomes are encoded in RNA, not DNA. And the therapeutic implications are obvious: Use the mechanism to prevent the production of disease-causing proteins, like the ones tumor cells make to survive; or the ones that cause rare diseases; or the ones viruses use to infect cell after cell (which I suppose you could call hijacking the hijackers).

As Dowdy describes RNAi, “it’s like a gift from God or whoever’s upstairs.”

As with anything in biology, however, the complications pile up quickly—the “dirty little tricks,” Dowdy says, that have kept that gift mainly beyond our reach. Many of them stem from this fact: RNA—or the RNA-like strands that companies have engineered to do therapeutic work—aren’t meant to be outside a cell, which makes getting them into the body and to the right spot a very frustrating exercise.

RNA molecules are fragile. Floating around in the bloodstream, they’re like foreign invaders, but not particularly tough ones. The body’s defenses recognize and chew them up easily. (Eye and liver cells are less problematic to reach and penetrate, which is why those areas have seen some clinical success.) Even if they evade detection, RNA have the same negative electric charge as cell membranes. Similar charges repel each other, as anyone knows after playing with magnets. It’s really hard to get RNA into a cell.

The big takeaway from Dowdy’s work is that he and colleagues have created RNA-like strands that hide from the body’s defenses and slip into cells more easily. They have a neutral charge, so the researchers have dubbed them RNNs, or ribonucleic neutrals. And they build upon a concept used by a lot of other pharmaceutical research programs: conjugation. Most notably, Seattle Genetics (NASDAQ: SGEN) and Immunogen (NASDAQ: IMGN)—and their larger partners Genentech, now part of Roche, and Takeda Pharmaceutical—have brought to market antibody-drug conjugates: cell-killing drugs chemically bonded to antibodies, which serve as homing devices that deliver the drugs into tumor cells.

Solstice wants to conjugate RNNs to similar homing devices—”targeting agents” is the term of art—that not only get them to the right cell, but hide them from the body’s defenses on the long journey. Once they’re … Next Page »

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Plug and Play San Diego Seeks New Ways to Get Startups into Program

Mon, 11/17/2014 - 05:40
Bruce V. Bigelow

In a few weeks, Plug and Play San Diego will convene its fourth pitch competition—giving entrepreneurs in the region a shot at spending three months in a boot camp for tech startups at the Plug and Play Tech Center in Sunnyvale, CA.

Alex Roudi, the San Diego investor and entrepreneur who helped Plug and Play open a satellite operation in San Diego, says it’s “been a blast” to watch three classes of San Diego startups go through the Plug and Play accelerator over the past two years.

“It’s wonderful to see how it can impact a company in terms of winning a critical customer or transforming the business strategy of the company,” says Roudi, who is managing partner of Plug and Play San Diego. “They are going in at one level and coming out at a much higher level.”

The Plug and Play Tech Center in Sunnyvale, founded by Iranian exile Saeed Amidi, attracts many companies from outside the Bay Area, with more than a third hailing from other countries. Roudi, who has known Amidi for years, says many out-of-town startups stay on in a Plug and Play facility for nine to 12 months to give themselves sufficient time to meet investors, raise capital, and make connections with big tech companies that could become strategic partners or customers. (In addition to its tech center in Sunnyvale, Plug and Play also holds commercial office space in Palo Alto and Redwood City, CA.)

“I’m pretty sure that all of the [San Diego] companies that have done the [accelerator] program have come back to San Diego,” Roudi says, “but they remain part of the program. They still go up to the Plug and Play facility in Sunnyvale and use those offices. We just recently had a couple of companies go up there to brainstorm with people they had met up there.”

In the meantime, Roudi says the San Diego Plug and Play team has been “trying to be more proactive in terms of inviting companies to apply.”

More than 90 companies applied to Plug and Play San Diego in the spring, including startups from Tijuana, Mexico, and Colorado. From these applications, the Plug and Play team in San Diego (which consists of Roudi, Robert Reyes, and Gabriela Dow) selected 17 companies to present at the pitch competition in May. A panel of expert judges selected five finalists for the accelerator program in Sunnyvale.

Since then, Roudi says Plug and Play has been scouting other startup pitch events, including the Startup Weekend that began Friday at the downtown San Diego library, to invite promising teams to apply for the Plug and Play accelerator program. “We might end up with fewer companies, but higher quality,” Roudi says. “We really want to get to a point where we can accept everyone who applies.”

In this way, Plug and Play San Diego has been trying to strengthen its ties with other local startup organizations as a way to funnel more … Next Page »

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Device Maker Says Ebola Patient Recovered After Blood Filtration

Fri, 11/14/2014 - 13:10
Bruce V. Bigelow

As the global death toll from the current Ebola outbreak officially hit 5,147 this week, a San Diego medical device company is reporting promising findings in the treatment of one infected patient.

Aethlon Medical CEO James Joyce said in an interview earlier this week that a Ugandan doctor stricken with Ebola is now recovering in Germany after receiving dialysis-like treatments with Aethlon’s Hemopurifier, a device that filters viruses from a patient’s blood. The company says its bio-filter uses a membrane coated with lectins—proteins that bind to carbohydrates. The filter captures viruses by binding with the glycoproteins on their surface. (The glycoproteins normally enable viruses to lock onto cells while they are circulating in the body.)

Aethlon says the Ebola virus can no longer be detected in the patient’s blood—in other words, the infection appears to have been vanquished. In a statement today, the company says, “The patient has since been moved out of a level-A isolation unit at Frankfurt University Hospital, with a recovery of organ functions.”

A German doctor who oversaw the treatment presented the latest findings about it today in a special session on Ebola and dialysis at the annual meeting of the American Society of Nephrology in Philadelphia.

Hemopurifier cartridge (bottom) in Ebola patient’s dialysis machine

In his presentation, Helmut Geiger, chief of nephrology at Goethe University, Frankfurt University Hospital, said the number of Ebola viruses in the patient’s blood plunged from 400,000 to 1,000 viral copies per milliliter following a single 6.5-hour administration of Hemopurifier therapy. The viral load never again rose above 1,000 copies per ml. The bio-filtration therapy was well tolerated, with no adverse events reported, according to Aethlon’s statement, which was released during Geiger’s presentation.

Following treatment, Aethlon said the filter used in the therapy was taken to a special bio-hazard facility at Philipps University of Marburg, where researchers found 242 million Ebola viruses had been captured during treatment.

The patient, identified in media reports as a doctor named Michael Mawanda, entered Frankfurt University Hospital after he was flown to Germany on Oct. 3 from Sierra Leone, where he fell ill while caring for Ebola patients.

Geiger said the patient did not receive Hemopurifier therapy until 12 days after he was initially diagnosed. By then, he was unconscious and suffering from multiple organ failures. He was being mechanically ventilated, continuously dialyzed, and was receiving medications to raise his blood pressure.

It’s unclear, however, whether Mawanda may have also benefited from other treatments he received during his prolonged stay at the Frankfurt hospital. For example, Reuters reported earlier this month that Mawanda received an experimental drug initially designed to treat vascular problems and help heart attack patients.

Anticipating a wave of interest following Geiger’s presentation, Joyce was in New York this week to brief … Next Page »

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Innovation Hub: The Next Wave of Sports Analytics

Fri, 11/14/2014 - 10:55
Kara Miller

We hear a lot about how giants in tech and e-commerce are using big data to improve business. But what about the role of data in a very different industry, one rooted as much in numbers as in superstition and luck? We’re talking about the world of sport.

Ever since the bestselling book and movie Moneyball, the use of data analytics by professional sports teams has been gaining traction. I discussed some of the innovative uses of big data with Kraft Sports vice president Jessica Gelman and ESPN marketer-turned-MIT lecturer Ben Shields.

[This interview has been edited and condensed. For the full conversation, visit innovationhub.org.]

Kara Miller: Is it fair to boil sports down to a data problem?

Ben Shields: You have to place data in the proper perspective. It is one way to help solve a problem. If I’m talking to a coach of a basketball team, I have to recognize that team chemistry, momentum, are also at play when you’re devising the best system for your team.

KM: How do players themselves use data?

Jessica Gelman: The beginning of sports analytics was around the valuation of a player. Today, athletes are using analytics on themselves. Within wearable technologies, there are companies like Zebra, Catapult, and Fitbit, which the average athlete wears today. That type of information is becoming even more pronounced.

KM: To what degree are sports franchises gathering data about fans?

JG: The focus for us is engaging and retaining our customers. When your e-mail opens, to when you come into the stadium, to when you make purchases—we track that information. With mobile ticketing, we can know everyone who’s in the building, and that’s going to be very meaningful.

BS: The Holy Grail here is the fan who is the season-ticket holder, who also goes to the website, and is a fan on Facebook and Twitter. Getting that whole picture will be a game-changer.

KM: And how are franchises using that data to change the game experience for fans?

JG: It’s an interesting data issue: are people always being honest in what they’re sharing? We asked recently what Web page people go to when they go to the website, and not one person said that they come to our cheerleader page. It is, actually, the second-most visited page on our website. Based on that feedback, we created a cheerleader cam. People like our cheerleaders. Yes, they are big fans of the team, but there are other elements to the game-day entertainment.

KM: What technological changes do you see happening that will be ubiquitous in the future?

BS: The Oculus headset that Facebook purchased could become more mainstream, so you could think about potential applications of virtual reality to watching sports. We’re at this place where we’re moving toward more fan participation in the games. Look at video games and fantasy sports. These are activities that bring fans closer to playing on the field, or being in the general manager’s office. The more fans can participate in the game, the better it’s going to be for them as spectators.

Mikaela Lefrak contributed to this report.

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West Coast Biotech Roundup: Intarcia, Dendreon, Amgen, Doudna & More

Thu, 11/13/2014 - 16:16
Alex Lash

[Corrected 11/13/14, 5:40 pm. See below.] West Coast spotlights this week are on new ways to fight disease. Some are close to getting to market: Amgen announced late-stage development and regulatory news about two drug programs that aim to treat psoriasis and heart disease through novel biomolecular mechanisms.

Some are a bit farther away: Bicoastal firm Intarcia signed its first major rights-sharing deal for its under-the-skin pump that, if approved, could change the way diabetes is treated. And some are still extremely experimental: UC Berkeley professor Jennifer Doudna won a life-sciences prize for her work that has helped turn an ancient bacterial defense system called CRISPR into a gene-editing research tool—and possibly a new kind of gene therapy. Let’s get to the roundup.

—Intarcia Therapeutics, with operations in Hayward, CA, and Boston, inked a deal with French drug firm Servier that gives Servier rights outside the U.S. and Japan to Intarcia’s implantable pump, which releases exenatide, a drug to treat Type 2 diabetes. Currently in huge Phase 3 tests, the pump would be refilled and re-implanted once or twice a year. Servier is paying Intarcia $171 million up front with up to $880 million more as the product reaches various milestones.

—Seattle’s Dendreon (NASDAQ: DNDN) filed for bankruptcy Monday. The firm is weighed down with a $620 million debt load coming due in 2016 and meager revenues from prostate cancer treatment sipuleucel-T (Provenge). An auction to sell the company is set for Feb. 3 at the latest, but if a bid of at least $275 million doesn’t materialize, the company could go through a recapitalization instead.

—Carlsbad, CA-based Isis Pharmaceuticals (NASDAQ: ISIS) said it intends to offer $425 million in convertible debt. The deal will let Isis retire as much as $140 million of existing debt, then use the remainder to retain control over and potentially commercialize certain drugs in its pipeline.

—Thousand Oaks, CA-based Amgen (NASDAQ: AMGN) and its development partner AstraZeneca (NYSE: AZ) said Tuesday an 1,800-patient Phase 3 trial of psoriasis treatment brodalumab met its primary endpoints. The trial is one of two comparing brodalumab to the marketed psoriasis treatment ustekinumab (Stelara). Ustekinumab inhibits proteins called IL-12 and IL-23; brodalumab (and other antibody treatments) are going after the related protein IL-17. Results from the second trial are expected by the end of 2014, Amgen said. A trial comparing brodalumab to placebo released top-line data in May. [An earlier version of this paragraph mistakenly identified the number of head-to-head trials vs. ustekinumab.]

—Amgen also said that its high-cholesterol treatment evolocumab has been accepted for review by the FDA, which will make its approval decision by late August 2015. Evolocumab is a PCSK9 inhibitor, part of a new promising class of drugs that Amgen, Regeneron, and others are developing for cardiovascular disease. Regeneron, working with Sanofi, paid BioMarin $67 million earlier this year for an FDA voucher that lets it cut four months from the approval review time. (Xconomy wrote about the FDA voucher program here.)

—University of California, Berkeley professor Jennifer Doudna won the 2015 Breakthrough Prize in Life Sciences for her research into the CRISPR/Cas9 bacterial defense system, which has become a new method to edit genomes, with potential use in therapeutics. Doudna and her co-winner, French researcher Emmanuelle Charpentier, published a paper in 2012 that is often cited as the key that unlocked the potential of the system. Doudna is a cofounder of Editas Medicine in Cambridge, MA, which is pursuing CRISPR/Cas9-related therapeutics, and of Caribou Biosciences in Berkeley. The prize is part of the series created last year by several Silicon Valley moguls.

—San Diego’s Auspex Pharmaceuticals (NASDAQ: ASPX) said the FDA has awarded orphan drug status to SD-809, currently in a late-stage trial as a treatment for Huntington’s chorea. The designation provides certain development and commercial incentives, including eligibility for a seven-year period of U.S. market exclusivity following product approval.

—Veracyte (NASDAQ: VCYT) of South San Francisco, CA, said Wednesday that Sam Colella, a managing director at Versant Ventures, has stepped down from its board. Colella’s replacement is John Bishop, the current CEO of diagnostics firm Cepheid and a 30-year veteran of device and diagnostics firms. Veracyte makes a test that helps determine whether certain thyroid nodules are benign.

—Avanir Pharmaceuticals (NASDAQ: AVNR) of Aliso Viejo, CA, said Nov. 7 it was pessimistic that its migraine treatment AVP-825, a drug-device combination, would win FDA approval under the current deadline of Nov. 26. The FDA has raised questions about the company’s clinical data and is asking for more design work and testing, Avanir said.

—IBM’s Watson Group (NYSE: IBM) made an undisclosed investment in Poway, CA-based Pathway Genomics to help advance Pathway Panorama, a mobile app that uses Watson technology to answer health-related questions based on a user’s own genetic data. While the amount was not disclosed, IBM said its investment brings total funding for Pathway Genomics to more than $80 million over the past six years.

—Oncology data provider Presage Biosciences of Seattle said Wednesday it has expanded its collaboration with Takeda Pharmaceutical.

 

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Brain Corporation Builds BrainOS to Train and Democratize Robots

Thu, 11/13/2014 - 05:00
Martin LaMonica

If you took apart a smartphone, you’d have many of the components needed to build a consumer robot: a low-power processor, software to run it, and an array of sensors. Qualcomm-backed Brain Corporation has turned the electronic guts of a phone into a foundation for making consumer robots, adding brain-inspired software to quickly program them.

The San Diego-based company plans to release its first product early next year—a suite of software tools, 3-D printable designs, and a hardware board with a Qualcomm processor. The development kit, called BrainOS, is designed to make it easier for third-party robot developers quickly build custom service robots for homes and businesses.

The problem with today’s robotics industry is that designers are forced to build a lot of the underlying systems that all robots need, says Todd Hylton, senior vice president of strategy at Brain Corporation. “Our feeling is that that’s not a good or scalable business situation. This industry really needs a horizontal technology provider, much the same way that the computing of mobile phone industry has companies and provide the core components,” he says.

Central to its plans is software that lets people program robots by showing them tasks. At the RoboBusiness conference last month in Boston, Brain Corporation showed off a demo of its “learn from demonstration” programming. A person with a remote control instructs a small, two-wheeled robot to, for example, run a figure 8 pattern around chairs. Once it was shown the pattern, the robot was able to perform the task alone and avoid obstacles.

Before joining Brain Corporation two years ago, Hylton worked at DARPA on a neuromorphic computation project to design chips that mimic the brain’s processing. And he says that the company has more algorithms, both neural-inspired and classic machine learning, under development designed to speed up robot programming.

Programming robots through demonstrations is not new. Rethink Robotics uses this technique for its manufacturing robot and academics have demonstrated the technique for many years. But Brain Corporation, which was founded by computational neuroscientist Eugene Izhikevich, thinks this technology is key to growing the robotics industry. A consumer could, for example, teach a robot to put things away or do specific tasks, such as vacuuming, Hylton says.

“We think there could be lots more apps, more sophisticated apps once the technologies we’re working on are broadly available. It shouldn’t be that hard,” he says.

Hylton demonstrates programming through demonstration. Credit: Brain Corporation

By providing what it hopes will be a common hardware platform for consumer robots, Brain Corporation is essentially attempting to do what IBM did for personal computers in the early 1980s. Once a common platform was created, the market for software and standards-based PCs flourished.

In the case of robots, Hylton hopes that a couple of hardware developers could rapidly build prototypes without having to spend millions of dollars. Much of the lower-level computing and software infrastructure, which runs on Linux rather than Android, will be taken care of.

Historically, common platforms and standards have helped fuel innovation in digital technologies. With Brain Corporation, the key will be how easy it can make programming service robots and whether a population of robot developers will form around its developer kit.

In parallel, Qualcomm is developing a neurophormic chip, which in theory could greatly improve the performance of service robots, such as their ability to navigate indoors. If that technology succeeds as hoped, Brain Corporation’s bet on neural-inspired software could pay off in a bigger way.

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Hush Begins Crowdfunding to Produce Noise-Masking “Smart Earplugs”

Wed, 11/12/2014 - 13:05
Bruce V. Bigelow

Hush, a San Diego startup that has developed “smart earbuds” to minimize the distractions of a noisy world, is beginning a crowdfunding campaign today that would enable the year-old company to produce as many as 10,000 units by spring.

Founded by three UC San Diego engineering students (all named Daniel), Hush has set a goal of raising at least $100,000 on Kickstarter to produce wireless, noise-masking earplugs with a Bluetooth link that enables a user to connect with a smartphone.

By downloading the Hush mobile app, users can set their notifications to allow important phone calls, calendar alerts, and wakeup alarms to go through—without disturbing sleeping partners. The app also enables users to fall asleep to the sound of ocean waves, rainfall, and other types of white noise, and a Hush tracker enables users to find missing earplugs.

Each pair of Hush earplugs also comes with a charging dock that doubles as a travel case.

Hush wireless earplug

CEO Daniel “Ewok” Lee says Hush created the Kickstarter campaign after raising $150,000 from angel investors over the past two months in the culmination of what might be described as a seed-stage “pitchfest” strategy for the hardware startup.

Lee says the idea for Hush came out of a senior-level undergraduate class for entrepreneurial-minded engineers. Loud neighbors and roommates kept him awake at night. Conventional earplugs worked OK, but then he started worrying that he wouldn’t be able to hear his wakeup alarm, and would be late for work. The result was an earplug that would block out the world, yet allow users to … Next Page »

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Next-Gen Network Monitoring: The Missing Piece of the Security Puzzle

Wed, 11/12/2014 - 10:00
Jesse Rothstein

If 2014 has taught us anything, it’s that IT security is falling behind the threats against which it is supposed to protect, and the gap is widening quickly. From data breaches at major retailers to serious zero-day vulnerabilities such as Heartbleed and Shellshock, the events of the last 12 months have caused everyone with an interest in IT security, including the C-suite, to stand up and take notice.

The good news is that the industry is taking the implications of these breaches to heart, recognizing that traditional perimeter-based approaches to IT security are no longer sufficient. To protect against today’s increasingly sophisticated threats, IT professionals must look beyond known vectors and perimeter defenses. New solutions must be proactive, pervasive, and persistent. They must be able to detect and defend against known threats while identifying and quickly reacting to unknown ones.

To tackle this challenge, IT teams are starting to focus on continuous observation of activity on the network inside the perimeter. Industry numbers indicate this shift: according to new research from Enterprise Strategy Group’s Jon Oltsik, “61 percent of enterprises now divide their network security equally between perimeter and internal networks.”

Today’s threats pose to challenges to traditional security models, but there are ways modern IT teams can protect against not only the barbarians at the gates, but also against those that have already breached the walls.

Advanced, Persistent Threats Expose Cracks in the Traditional Security Model

Many security tools today run on the host system, including privilege models, firewalls, and antivirus software that scans for known malware. While host-based security offers some basic protection, the reality is that there are always flaws and vulnerabilities that can be exploited. Potential threats include malware capable of privilege escalation or other ways around access controls. And as soon as the malware is within the host, the chances that you’ll ever find it using traditional tools are slim. Unless it’s designed specifically to call attention to itself, today’s sophisticated malware is stealthy enough to fly under the radar indefinitely.

The second traditional approach involves perimeter security, which includes firewalls as well as both Intrusion Detection Systems (IDS) and Intrusion Prevention Systems (IPS). These technologies form the basis of what is colloquially known as the M&M approach to IT security, which forms a hard shell around the perimeter but leaves the internal network a soft target. The problem with this model is that today’s advanced persistent threats often utilize credentials stolen from contractors or take advantage of zero-day vulnerabilities. Moreover, most IDS and IPS products rely on signatures, which means they have to know what to look for. How can IDS or IPS catch attacks that no one has seen before?

Looking to the Network: A Data-Focused Approach to Security

As threats have become increasingly able to circumvent the more traditional security models, a new data-centric approach has emerged. Log files are one important source of visibility, as IT can look at the data a machine is self-reporting to determine if there are anomalies. The problem with using log files alone is that self-reporting is inherently unreliable. One of the first things that attackers do when they have compromised a system is modify the logs in order to cover their tracks. With logs, you only know if there’s a problem if the machine logs a problem.

While logging and host-based protections can be evaded, wire data is inherently observational, providing a view of all lateral communications between systems. Even if an advanced persistent threat has established a foothold within the internal network, it cannot avoid connecting with other systems as it performs reconnaissance, stages data for exfiltration, and receives command-and-control messages. With the depth and richness of visibility provided by wire data, IT and security teams are armed with the information and insight they need to detect anomalies and perform forensic investigation. If a particular host begins communicating with a database that it has never encountered before, security teams detect the communication and then determine which resources were accessed, who did the accessing, and when.

This comprehensive visibility has proven its value recently with the Shellshock vulnerability. As soon as the vulnerability was announced, enterprises and datacenters were immediately bombarded by hackers looking for vulnerable servers. Using traditional security tools, IT teams faced challenges when attempting to determine which servers were being hit and by whom. However, by looking at the communications between systems on the network, especially HTTP messages containing the exploit attempt in a header, teams could see exactly which servers were being probed and by whom.

As with any approach, using wire data for IT security has its challenges. The nature of today’s threats also means that the monitoring must be done in real time. Discovering a breach that occurred yesterday implies that your systems are already compromised.

The sheer volume of data on the wire is also a challenge. First, analysis systems must be able to scale to wire speeds to deliver a comprehensive and persistent view of the network. Second, the monitoring platform that you select must be able to parse out relevant data in order to pare down the data to a reasonable volume for storage purposes. Recording all of the data from a single 10Gbps link will fill up 100 TB in just 24 hours. This level of activity can’t be sustained long term, especially as we look forward to 40Gbps and 100Gbps networks.

Next-gen monitoring that utilizes wire data is already proving to be a powerful complement to more-traditional security models. As enterprise IT and security teams increasingly recognize the shortcomings of the traditional model as a standalone solution, demand for next-gen and wire data intelligence solutions will increase. In turn, expect to see both new innovation and market consolidation as established players look to meet this customer demand.

[Editor's note: Rothstein will be sharing more insights in conversation with Isilon co-founder and ExtraHop board member Sujal Patel at Xconomy Xchange: Beauty and the Data Beast—Seattle Innovation Stories on Nov. 18.]

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With Wires and Electrodes, Tara Bio Builds a Heart on a Chip

Wed, 11/12/2014 - 08:28
Ben Fidler

It’s been pretty clear for some time that there’s a big need to improve the efficiency of drug R&D. By industry’s count, drugs cost over $1 billion to develop, and most of them fail. A big reason why is the preclinical studies in petri dishes and animals don’t accurately predict how a drug will behave in humans.

That problem has prompted a slew of companies to innovate new ways to test drugs in a more human-representative fashion, and perhaps even change how preclinical testing is done. The latest to come along is Tara Biosystems, a New York-based Columbia University spinout whose founders say they’ve found a novel, stem-cell based approach that can simulate how a human heart would react to a drug.

Tara recently started up with the help of seed funding from New York-based Harris & Harris Group (NASDAQ: TINY), a publicly-traded venture firm that invests in early-stage companies. Misti Ushio, a managing director and executive VP of Harris & Harris, is leading the company, which is being incubated within the firm.

Tara CEO Misti Ushio

Regulatory filings show that Harris & Harris has invested around $300,000 in Tara. Ushio says the seed funding gives the company about a year’s worth of runway to prove itself—to validate its technology, convince pharmaceutical companies of its worth, and essentially earn an additional investment, like a full-fledged Series A round.

Tara is based on the work of two researchers: Columbia professor Gordana Vunjak-Novakovic and University of Toronto professor Milica Radisic. They met several years ago at Bob Langer’s lab at MIT and have since worked together to turn stem cells into mature heart tissue that can be tested as if it were an adult heart.

At the core of Tara’s technology are what the founders call “biowire.” Two parallel polymer wires are attached to the wells of a 96-well microplate (pictured above), a common piece of research equipment; the wells function as small test tubes.

The idea is that a researcher would put stem cells into the wells, and then mature them with the help of electrical stimulation. The stem cells grab on to the polymer wires and grow across them as they mature, eventually forming what amounts to tiny micro-hearts, with all of the different cell types that constitute adult heart tissue. Those tiny hearts beat, and pull on the wires when they do. The wires allow for tension, which is important, because by measuring how those wires move, a researcher could determine how the heart contracts, and what, specifically, is causing it to contract in the way it does.

The idea is that these measurements, on mature heart tissue, would give pharmaceutical companies a more accurate read on how drugs affect a human heart before they’re tested in people and potentially cause cardiotoxicity, or damage to the heart—a death knell for many drugs, not to mention hazardous for patients.

“People want all the features of the heart in one place, so you can see the interactions and how one thing influences the other,” says Ushio. “And then you can test new medicines to see how that changes.”

Tara envisions researchers using any stem cell type for this process, either grown in their own labs or purchased from a company such as Madison, WI-based Cellular Dynamics (NASDAQ: ICEL).

The biowire concept piqued the interest of Harris & Harris, which, Ushio says, has been looking for ways to harness 3-D tissue for commercial use. Ushio worked in Columbia’s tech transfer office for one year and is on the executive committee of a Columbia review body that funds translational research.

She’s known Vunjak-Novokovic for years and formed Tara a few months ago after gauging the interest of various pharma and biotech companies. The company was named Tara after a mountain in western Serbia, where both Vunjak-Novokovic and Radisic are from originally.

As with many fledgling biotechs with intriguing technology, Tara is still figuring out its business model. The founders don’t know whether they’ll simply make and sell their hearts-on-a-chip, or help their customers use them to get the data they need as well.

Tara has a lot of competition in trying to change the way preclinical testing is done. The idea of organs on a chip has been around for years, but it’s never been scalable, comprehensive, or user-friendly enough to make an impact on preclinical drug testing.

Now, however, advances in technology have led to a number of startups and academic groups with competing systems that are either already on the market, or on their way. A Boston startup called Emulate was just spun out of the Wyss Institute this past summer; it’s making a lung-on-a-chip, and has designs for an integrated body-on-a-chip.

Others include Seattle startup Nortis, a University of Washington spinout; North Brunswick, NJ-based Hurel Corp., which uses an organ-on-a-chip method to replicate liver tissue; and the Dutch firm Mimetas. San Diego-based Organovo Holdings (NYSE: ONVO) and others also aim to use 3-D printing techniques to help speed up preclinical drug development.

“We’re all trying to tackle the same problem,” Ushio says. “But Tara is trying to just tackle the heart first, and nail that. It’s pretty clear that people have been looking for the technology to do this, and they can’t find it.”

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San Diego Deals Roundup: On-Ramp, Scoperta, Proximal Data

Tue, 11/11/2014 - 05:40
Bruce V. Bigelow

There’s been a flurry of deals among San Diego’s tech startups in recent weeks, perhaps reflecting an effort to get financing and other transactions secured before the holidays—and while market conditions remain good. In addition to funding rounds raised recently by Mogl and the cleantech company Noble Environmental Technologies, other noteworthy tech deals include:

—San Diego’s On-Ramp Wireless has raised about $500,000 of a planned $4.8 million financing round from investors, according to a recent regulatory filing. The company has developed wireless networking technology for efficiently connecting billions of hard-to-reach devices over metropolitan-scale areas and other challenging environments.

On-Ramp Wireless says its technology is well-suited for field use in the utility, energy, and agricultural sectors, and that rival cellular and mesh networks lack the reach, capacity, and scalability of On-Ramp’s wide-area, machine-to-machine (M2M) technology. The additional $4.8 million in debt and convertible securities appears to be another extension of the Series C funding round that On-Ramp disclosed last year, and which the company increased to nearly $39 million earlier this year.

Scoperta, a San Diego materials company that specializes in making innovative amorphous metal alloys and coatings for a wide range of industries, has raised $1 million of a planned $4 million round from venture investors, according to a recent regulatory filing. Proceeds from the offering will be used for general working capital and payroll, according to the filing.

Scoperta’s website says it produces amorphous alloys, or metallic glasses, for uses that require stronger, harder, and more corrosion-resistant materials than conventional metal alloys. Scoperta says its materials are intended for use in the military, mining, offshore, and power-generation industries, but the company has technical specifications on its website for just two types of wire products.

Scoperta was founded in 2005, and has raised several rounds from San Diego’s Enterprise Partners Venture Capital and Boulder, CO-based Vista Ventures.

—Poway, CA-based 405Labs, a computer-security startup founded earlier this year, intends to raise slightly more than $2.3 million from investors, according to a recent regulatory filing. The company plans to use the funding for working capital and employee salaries.

The founding CEO is Alex Watson, a co-founder of BTS and APX Labs who led security research at Websense, the San Diego network security company now based in Austin, TX. On its 405Labs website, the company says its team includes “security researchers, data scientists, and machine-learning experts” from the U.S. intelligence community, cyber-security firms, and academia.

—Samsung Electronics said it has acquired San Diego-based Proximal Data, a three-year-old company that specializes in software that improves storage performance by controlling and storing frequently used data more efficiently. Financial terms of the deal were not disclosed.

Rory Bolt, a former NetApp technical director, founded Proximal and raised about $6 million in venture capital from San Diego’s Avalon Ventures and Correlation Ventures, as well as Seattle-based Divergent Ventures. The deal follows Samsung’s 2012 acquisition of NVELO, a Santa Clara, CA-based creator of caching software for a type of high-performance data storage technology known as server-based SSDs (solid-state drives).

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Lowering the Cost of Failure in Biopharmaceuticals

Tue, 11/11/2014 - 05:00
Court Chilton

In any business, projects fail, but in biopharmaceuticals, the consequences of failure are especially damaging. Projects in the industry tend to be long and expensive—from clinical trials to regulatory approvals to commercial application. At any point in the process, obstacles can derail a project. Failure is most certainly an option, and for companies with many projects in the pipeline, failure is inevitable.

In this environment, large biopharmaceutical firms need to focus less on avoiding failure and more on reducing its costs. Most companies unfortunately do the opposite. The industry suffers from what is known as “inattentional blindness” and “continuation bias.” Inattentional blindness occurs when firms focus primarily on, for example, the biological hypotheses behind a compound early in trials and don’t also focus on downstream clinical risks, patient selection, and commercial hypotheses.

“Continuation bias” occurs because, over the course of lengthy projects, sunk costs accumulate. Even when clinical trials are going badly, no manager wants to be the one to announce to the company that all of the money spent on a project has been wasted.

Managers thus develop approaches to keep projects with thin prospects going. Outsourcing is one way. Firms can be contracted to conduct unpromising trials, thereby distancing managers from the results. Outsourcing tends to slow learning cycles within a biopharmaceutical firm, which also tends to extend projects past their expiration dates.

Another source of continuation bias is that in big firms projects often are understaffed. With many projects under way simultaneously, big and established biopharmaceutical firms try to gain some leverage, some efficiency by staffing projects thinly, which results in projects that are “long and thin.” Startups, counterintuitively, are even more likely to fall into this trap because—even though they can create “short, fat projects”—ending a project often means the end of the firm.

For big biopharmaceuticals, the challenge is this: how to fail fast. Managers need to pay close attention to the results of early stage clinical trials. Sometimes additional tests that are relatively quick and sharply focused can be ordered to determine whether the basic biology of a drug is going to be effective, or whether a patent can be extended. If those results are unfavorable, then projects can be halted before they move into the next, much more expensive phases.

The related challenge: developing cultures in which employees understand that failure is not a career killer. The manager who decides to shut down a project that is going into a downward spiral should be rewarded, perhaps even celebrated, not punished. Instead of hiding failures, biopharma needs to recognize and accept it, then generate wider learning from it and move forward.

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DMI Diagnostic Device Wins Grand Prize in Nokia Sensing XPrize

Mon, 11/10/2014 - 11:00
Bruce V. Bigelow

The XPrize Foundation returned to San Diego today to announce that a team led by Eugene Y. Chan of the DNA Medicine Institute (DMI) in Cambridge, MA, is the winner of the second $525,000 grand prize in the Nokia Sensing XPrize Challenge.

X Prize founder and chairman Peter Diamandis and Nokia CTO Henry Tirri announced the incentive prize competition during a 2012 digital health conference in San Diego as a way to stimulate innovations in wireless health sensing technologies. Finland’s Nokia provided a $2.25 million pool for awarding a series of prizes through two separate, consecutive competitions.

XPrize organizers plan to honor the DMI team at a lunchtime ceremony today during the Exponential Medicine Conference underway at the Hotel del Coronado, just across the bay from downtown San Diego. In a statement today, Diamandis says the technology DMI submitted “embodies the original goal of the Nokia Sensing XChallenge—to advance sensor technology in a way that will enable faster diagnoses and easier, more sophisticated personal health monitoring.”

An expert panel of judges selected DMI from 11 finalists, giving DMI the highest combined score in accuracy, consistency, demonstration quality, technical innovation, human factors, market opportunity, originality, and user experience. DMI designed portable diagnostic technology that can carry out hundreds of clinical lab tests on a single drop of blood—and provides accurate results within minutes.

Eugene Y. Chan and DMI team.

DMI says just about anyone can use its handheld “rHEALTH” device, or Reusable Handheld Electrolyte and Lab Technology for Humans system. DMI’s rHEALTH system consists of microfluidic technology that mixes diagnostic nanostrips into a drop of blood, and uses a laser to perform rapid cell counts and to measure electrolytes, proteins, and other biomarkers. DMI funded most of the development through grants from NASA, the NIH, and the Gates Foundation.

DMI rHEALTH devices

In a statement, Chan says, “Our hope is that the rHEALTH system, once commercialized, will enable consumers to monitor their own health while on-the-go in a more efficient manner and alert them of more serious medical concerns almost immediately.”

Chan, a physician-innovator, founded DMI in 2004, and serves as CEO and chief scientific officer. The small group specializes in developing advanced biomedical technology and devices, and provides R&D consulting services, among other things.

DMI also is one of 10 finalists selected three months ago for the $10 million Qualcomm Tricorder XPrize, a separate incentive prize competition organized by the XPrize Foundation. The winner will be announced next year.

The first $525,000 grand prize in the Nokia Sensing XPrize Challenge was awarded last year to Nanobiosym, a Boston-area organization led by Anita Goel, for its development of a portable diagnostic device that accurately detects the genetic signature of any pathogenic organism. Nanobiosym Diagnostics’ Gene-RADAR is intended to provide rapid and affordable medical diagnostics, even in developing countries where electricity and water are not widely available.

The 11 finalists, culled from a field of 27 teams in five countries, were announced in October. Of those finalists, the expert panel convened by the X-Prize Foundation also selected five teams for a $120,000 “Distinguished Award.” Those teams are:

Biovotion, a medical device company based in Zurich, Switzerland, is developing a multi-sensor wearable device for monitoring vital signs to provide hospital-quality monitoring to people with chronic medical conditions.

Eigen Lifescience, a Stanford University team engineered a biosensor platform that uses giant magneto-resistive spin valves to detect biomolecules for use in diagnosing individual patients.

Golden Gopher Magnetic Biosensing, a Minneapolis, MN-based team, also created a portable giant magneto-resistive biosensing system to detect biomarkers in human serum and urine samples.

Gues, based in London, England, has developed a sensor and companion mobile app for detecting sleep apnea as well as abnormally low respiratory rates.

Endotronix, a startup founded in Woodridge, IL, uses a biosensor implanted in the pulmonary artery and integrated with a wireless handheld device to monitor people with congestive heart failure.

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Beg, Borrow, or Steal: Accessing Unaffordable Science Journals

Mon, 11/10/2014 - 05:00
Stewart Lyman

If you work in academia or in Big Pharma, you likely have easy access to the world’s scientific literature. Outside of these places, however, obtaining affordable access to the latest scientific journals is much more problematic. This includes scientists at all but the largest biopharma companies, doctors and other health care professionals, and people wanting to research diseases for themselves or loved ones.

Many journal articles cost $30 to $35 each to download, so it’s easy to run up a big bill in a hurry. Given that Big Pharma is outsourcing much of its early stage R&D to small biotech companies, it’s more important than ever that people working in these places be able to keep up with what’s happening in their fields. Compounding the problem: the worldwide production of scientific literature continues to grow at an overall rate of 2.8 percent each year.

I’ve been exploring ways to obtain cheaper access to articles in the scientific literature for those who can’t afford to purchase them a la carte. I’ve written about this subject in previous articles for Nature Biotechnology and Xconomy, and it’s clear from the response to these stories that I touched on a nerve. People hate it when the dreaded paywall appears when trying to access a link on the Internet. Nothing is more annoying than finding out that you can’t readily access some information that’s been put forth in support of a point made in an online article without a credit card in hand. My back-of-the-envelope calculations show that approximately 73 percent of full-text articles in PubMed are secured behind a paywall (that’s over 10 million papers).

I’ve suggested a new model for gaining access to the literature, based on iTunes, and that I named iPubSci. The idea has been well received by many scientists, but implementation is going to take a sea change in academic publishing business models. One blog writer suggested that the concept has already been discredited simply because it has not yet been adopted. I can’t guarantee that it will ever become a viable business model. The change from purchasing records or CDs to buying individual songs has been a financial calamity for music publishers, as described in Robert Levine’s finely detailed book, Free Ride: How Digital Parasites Are Destroying the Culture Business, and How the Culture Business Can Fight Back. The effects on musical artists, however, are much less clear. Moving to a model where people can purchase individual research articles instead of entire journal issues will likely be anathema to academic publishers as well, as it does not fit in with their current (and highly profitable) business models.

What are the primary ways that people access the scientific literature if you don’t happen to work at a research university? Faced with this lack of access, I’ve found the most common approaches are for people to “beg, borrow, or steal” their way in. According to the online Cambridge Dictionary, this phrase means, “to do whatever is necessary to get something.” Here’s how they do it:

Beg
This approach works pretty well if you’re looking for a recently published paper: simply email one of the authors and ask for a pdf reprint. I keep a blank template loaded in my email program that just requires me to fill in the investigators name and the title of the paper. I’ve found that my success rate using this approach to be pretty high, maybe around 85 percent or so. It also provides an entrée to the author should you have any follow-up questions or comments on the data described in the paper. Getting the investigator’s email address is often easy, but sometimes very hard. Some journals facilitate this process by making the address readily available; others deliberately obfuscate this process by making you contact authors directly through the good graces of the journal. They don’t provide email addresses, and I suspect that requests made here for reprints may somehow not find their way to the author. It’s also a good idea to look at the senior author’s website, because many principal investigators maintain downloadable pdf files of their papers in that location.

Unfortunately, accessing copies of older journal articles via the “beg” approach is very challenging: many authors will have moved on to other institutions, retired, or died since the articles were published, and a substantial percentage of vintage articles may not be readily available in a digital format (e.g. pdf file) that facilitates their rapid transfer.

Borrow
Borrowing is just another way of sharing journals. This is a common approach used within small biotech companies: a number of people each purchase an individual subscription, which is then shared among the group. This process does not readily lend itself to having a significant number of subscriptions, because they would very quickly become unaffordable. Considering that many scientists in biomedicine would want access to at least a hundred journals, this doesn’t work out in a small, industrial setting. Virtual biotech companies (i.e. those that outsource all of their R&D, clinical, and regulatory functions) will be especially challenged in this regard. There are also the usual issues of physically finding older print copies, which may be at a work site or at home. It’s also possible (and maybe even likely) that if someone leaves the company they will take all of their back issues with them.

How else can you “borrow” access to science journals? A second approach is to simply visit your local institution(s) of higher learning and access the materials you need directly from the campus libraries. For those who don’t live near such places this would still be a burden, but for many other folks this is a solid approach. The librarians are usually quite helpful at providing instructions on how to access what you need. Depending on the place, you may be able to print out what you want, email articles home to yourself, or download them and take them away on a flash drive. Additional costs associated with this approach would include transportation, parking, and possibly printing or photocopying costs.

Steal
Got some nice, friendly neighbors who work at the local university and have remote access to their online library? If they are willing to share their access code, you will now have a convenient doorway into the library’s journal articles as well. I harbor no illusions that such an approach is likely illegal and that university administrators (and publishers) will not condone this practice. The success of this approach depends on having an accommodating neighbor as well as a university that makes no effort to ferret out such transgressions. Exactly how many people employ this approach is difficult to say. It’s unlikely that people filling out journal usage surveys, whether from the university or the publishers, would admit to this particular route of access.

Other Handy Tips and Tricks
One of the biggest frustrations associated with purchasing science journal articles is that you can’t preview the paper. Buy it, and only then may you realize that it doesn’t actually contain the information that you were seeking. Abstracts aren’t always composed in a way that allows you to figure out exactly what data are provided in the paper; many are poorly written. I’ve described this situation as being akin to … Next Page »

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How a Big Company Can Run Fast, Like a Startup

Fri, 11/07/2014 - 16:14
Elaine Chen

What does the word “startup” mean to you?

Many words can come to mind: new, exciting, experimental, small, lean, agile, fast. To me, “startup” mostly makes me think of “agile” and “fast.”

In an early stage startup, everybody is focused on the same thing. People are passionate, enthusiastic, hungry for an opportunity to change the world, and they will do whatever it takes to get things done. At a headcount of 5-10 people, coordination comes naturally. There are no legacy processes to slow things down. Without existing customers, the team is free to modify their products and services as they learn more. There is also a shared sense of urgency. So they run fast: because it’s fun, because they can, and because they have to.

Contrast that with an established company with a healthy, mature business. Let’s say the company has a global headcount of 100,000. Suppose one of the business units has 6,000 people. The R&D team may have 450 people. The revenue for this business unit is growing at 5-10 percent year over year.

Now suppose two product leaders in this R&D team come up with an idea for a radically different product offering that can turn things upside down. If things work out, this could quadruple their total addressable market. But these leaders still have responsibilities to the existing business, as do all the potential team members. Under these conditions, how would they get started?

Entrepreneurially minded product leaders in big companies have significant advantages over the average startup founder. They are funded, they have teams, their core technology is solid, and they have deep market knowledge from their existing business. But they still face daunting challenges:

  • Budget Catch-22. They have an existing budget, earmarked for sustaining development for existing products. They need a new budget to support experimentation, which will not be approved until they show progress.
  • Divided attention from product leaders. Founders for a startup can focus single-mindedly on making their new idea work. Leaders of new initiatives in a big company are still responsible for the existing product portfolio.
  • Legacy processes. A team at scale has comprehensive processes that govern how work is managed and coordinated, how information is shared, and how decisions are made. These processes are almost never aligned with “fast” or “agile.”
  • Functional silos. A technical team at scale is often organized by functional disciplines. While this is great for streamlining well-understood work, it is not the best structure to power the amorphous experimentation phase for a new program.
  • Organizational dynamics. A successful company at scale has well defined rules of engagement, as well as incentive systems to optimize productivity for existing work. These rules and systems may discourage team members from working on new, risky, unproven ideas.
  • Pace mismatch. The pace of new product development is much different from that of sustaining engineering. It could be hard for the team to switch from a marathon pace to a sprint.
  • Risk against the status quo. What if the new idea works too well, and it cannibalizes the existing business? This concern could be used to smother a new idea before it gets going.

How can product leaders address these challenges and pursue their ideas, with the speed and agility of a startup?

A lot of the startup magic lies in having a small team that comes together by choice to build something out of nothing. Entrepreneurial teams in big companies can potentially emulate this dynamic. Here is a thought experiment on how product leaders can build an internal startup inside a big company.

  • Get buy-in from senior management. This support is needed to help them delegate their existing responsibilities to free themselves up, recruit people to join their quest, and to operate without hiding the project from everyone.
  • “Secure funding.” Frequently product leaders have a fixed annual budget that is set without their input. They would need to find creative ways to meet existing goals, while freeing up people to work on the idea.
  • Build an A-team. Hand-pick a small, cross-functional team with complementary skills to dedicate to the project. Start small: find a hustler, a hacker, and a designer. Find people who are excited to pursue this new idea. They must choose to join this team, and they must feel energized about adopting a completely new work style and pace.
  • Find office space. Set up the team as a semi-autonomous entity in a location that is psychologically separated from their original teams. This could be as simple as moving people from different departments to sit next to each other.
  • Provide some autonomy. Empower the team to make most of the important decisions about the project independently, without going through normal corporate processes.
  • Define mechanisms for “corporate governance.” Come up with some lightweight mechanism to provide managerial foresight. For instance, there might be a senior management debrief once every month or two.

Now the team is ready to begin, starting with customer development. They will need to get out of the building to find out who their customers and users are. With validated hypotheses about target customers, the team can then work on their minimum viable product. This will launch them into the build-measure-learn cycle until they find product-market fit.

Big companies have financial and domain knowledge advantages over startups. Startups have human systems advantages over big companies. By combining the best of both worlds, entrepreneurial teams in established businesses can very well give startups a run for their money in speed and agility.

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Innovation Hub: The Power of You

Fri, 11/07/2014 - 14:00
Kara Miller

A few decades ago, big companies like GE and IBM controlled product pipelines, meaning that they would likely bring groundbreaking inventions to life. Now, a college junior can have a good idea and build an entire business around it using only a crowdfunding website, open source technology, and a 3D printer.

What effect does this power shift from corporations to individuals have on our larger society? We brought the question to a panel of experts at our recent live event, which included author Nicco Mele and Harvard Business School professor Karim Lakhani.

[This interview has been edited and condensed. For the full conversation, visit innovationhub.org.]

Kara Miller: What is causing innovators to turn their backs on big companies?

Nicco Mele: Technology has, over the last 35 years, pushed power to individuals. In 1820, the vast majority of Americans were self-employed as shopkeepers and subsistence farmers. By 1920, the vast majority of Americans were employed by a corporation. Over the last 20 years, that pendulum has swung back in a significant way to people being self-employed. And, you know, it sure beats having a boss.

KM: Instagram had only 13 employees when it was taken over for a billion dollars. Barnes and Noble is worth approximately the same amount, and it has 33,000 full-time employees. How is this possible?

Karim Lakhani: There’s been a shift in the cost of computation. When I was graduating from MIT, to do a startup you’d need 10 million bucks, 30 engineers, and all this software to get going. Today, if you get half a million bucks, you might be OK. You can get computation from the cloud, open source tools, and scale in ways that weren’t possible before. Instagram was running on Amazon’s Web servers, which made it possible for them to do what they were able to do. Technology is becoming democratized, and access to the technology is becoming widespread.

NM: It begs the question, what are the advantages to scale?

KL: If you’re going to make a 787 airplane, you need scale. Some really important problems require scale, time, coordination, and diversity of expertise. So the question becomes, what’s the organizational form that can sustain this? Is it always going to be the GEs, IBMs, and AT&Ts of the world, or can we have more fluid, distributive forms take place?

KM: When you think about where the creative people are going these days, what happens to everyone else, particularly in regards to the consolidation of money?

NM: I think the world is full of opportunity if you’re a student at an elite university. But the Department of Labor did a study that says between 16 to 19 percent of parking attendants in the U.S. have a four-year college degree, and the debt that comes with it. Broadly speaking, a lot of our institutions are not addressing the challenges we’re facing.

KL: Right now, we’re in a stage where we’re seeing tremendous inequality in the economy. But at the same time, people are inherently problem-solvers. You go, oh my goodness, are we back at the start of the industrial revolution? Maybe, to some degree. But I also believe that adjustments will be made, and we will go after the big problems that we want to be solving in health, energy, food, and so forth.

Mikaela Lefrak contributed to this report.

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